FxWirePro: EUR/USD hammer formation counters engulfing to hamper bearish momentum, major trend gaining upside traction ahead of CPI estimates

EURUSD keeps spiking higher above DMAs ever since the formation of hammer pattern candle at 1.1837 levels to counter bearish effects evidenced by the bearish engulfing pattern at 1.1919 levels and to signal the strength in rallies.

So far, the consolidation phase remains intact despite lingering overbought pressures.

Well, for now, we could foresee the bullish sentiments are likely to intensify especially after the bullish DMA crossover (refer 2H charts).

On the contrary, the shooting star has occurred to hamper the uptrend sentiments (refer monthly plotting) but this hasn’t been backed by leading or lagging indicators. Instead, these technical indicators signal the momentum and trend which is in favor of bulls. Hence, more rallies seem to be on cards upon the resurgence at the strong support 7EMA levels and bullish EMA crossover. 7EMA crosses over 21EMA which is a bullish EMA crossover to indicate the continuation of consolidation phase in the major trend

As and when you could see the formations of shooting stars, there has been considerable price slumps but they have been just a slight caution for the aggressive bulls.

On a broader perspective, the bull swings have managed to break range resistance, the rallies likely to drag only upon support at 7EMA.

As the above stated bullish pattern counters the short term downtrend momentum, this is also coupled with signals of bullish convergence from the leading oscillators, we foresee further buying opportunities.

While both lagging indicators (DMAs, EMAs & MACD) have also been signaling extension of the uptrend (refer daily & monthly charts).

Currency Strength Index: FxWirePro's hourly EUR spot index is gaining traction displaying shy above 46 levels (bullish) ahead of today’s announcement of euroarea flash CPI estimates. Eurostat bases this estimate on energy prices and 13 euro area member states that report early CPI data. While hourly USD spot index was inching towards 80 (bullish) as the greenback recovered on a steeper US treasury yield curve back above 60 bps yesterday for the first time since 20 November. while articulating (at 07:25 GMT). For more details on the index, please refer below weblink:

http://www.fxwirepro.com/currencyindex.

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